Iran and the Strait of Hormuz

“We did not say that we would close the Strait of Hormuz…the Islamic Republic of Iran is the most important provider of security in the strait…if one threatens the security of the Persian Gulf, then all are threatened.”

Nearly 35% of daily traded oil passes through the Strait. Importantly, all of Iran’s exports are shipped through the Strait. During the Iran-Iraq War, when Iran was locked in a brutal stalemate, Iranian authorities made repeated threats to close the strait; the United States called their bluff, and even in that dire situation they never followed through.

This might be mere gamesmanship on the part of the Iranian government, in an attempt to cause jitters in the oil market. On the other hand, it may be a sign of deeper dysfunction within the Iranian government. As a result of international pressure confidence in Iranian currency is collapsing, and the Iranian government does not appear to have an effective response to their economic woes. Although Iranian public opinion is hard to gauge, it is difficult to imagine that the Iranian people are pleased with such a toxic economic environment, and unrest is increasingly likely. The Iranian authorities may be hoping that braggadocio rhetoric can distract from the situation.